DnB NOR Leads Bank Rally in Norway on Government Fund
Feb. 9 (Bloomberg) — DnB NOR ASA, Norway’s biggest bank, led a rally in financial services in Oslo trading after the government announced two funds to unfreeze lending and buy corporate bonds to boost economic growth.
DnB NOR rose 5.3 percent to 27.90 kroner, a five-week high, valuing the bank at 37.1 billion kroner ($5.6 billion).
Norway, the world’s fifth-largest oil exporter, will set up a finance fund of 50 billion kroner to boost capital at banks, and a bond fund of 50 billion kroner to buy corporate debt, the Finance Ministry said in a statement yesterday. The government also proposed capping executive pay at banks.
“The package is somewhat larger than expected, that’s the main surprise,” said Andreas Hakansson, an analyst at UBS AG in Stockholm who has a “buy” rating on Oslo-based DnB NOR. “It’s too early to tell who will be the biggest beneficiary as the details are still unclear.”